ACCOUNTING CRASH COURSE EXAM V4
2026 PRACTICE TEST BANK WITH RATIONALES
AND STEP-BY-STEP SOLUTION GUIDE
◉ The following information was drawn from the accounting
records of Smith Company
Static Budget Flexible Budget Actual Results
Sales $13,500$ 19,000$ 21,100
Cost of Goods Sold (6,700)(8,600)(7,250)
Gross Margin 6,80010,40013,850
Variable Cost (2,700)(3,450)(4,350)
Fixed Cost (1,700)(1,700)(2,000)
Net Income $2,400$ 5,250$ 7,500
Based on this information the.
Answer: variable operating cost flexible budget variance is a $900
unfavorable variance.
($4,350 − $3,450 = $900)
unfavorable because actual variable operating cost was higher than
expected.
,◉ The following information was drawn from the accounting
records of Smith Company
Static Budget Flexible Budget Actual Results
Sales $13,500$ 19,000$ 21,100
Cost of Goods Sold (6,700)(8,600)(7,250)
Gross Margin 6,80010,40013,850
Variable Cost (2,700)(3,450)(4,350)
Fixed Cost (1,700)(1,700)(2,000)
Net Income $2,400$ 5,250$ 7,500
Based on this information the.
Answer: cost of goods sold volume variance is a $1,900 unfavorable
variance.
($8,600 − $6,700 = $1,900).
amount of cost of goods sold shown in the flexible budget is higher
than the amount shown in the static budget, the variance is
unfavorable.
◉ The following information was drawn from the accounting
records of Ashton Company.
Budgeted Actual
Sales $8,000 $10,200
, Cost of Goods Sold (4,200)(5,400)
Gross Margin 3,8004,800
Variable Cost (1,600)(2,100)
Fixed Cost (1,700)(1,300)
Net Income $ 500 $ 1,400
Based on this information Ashton Company has a.
Answer: $400 favorable fixed operating cost variance
($1,700 − $1,300).
◉ The following information was drawn from the accounting
records of Ashton Company.
Budgeted Actual
Sales $8,000 $10,200
Cost of Goods Sold (4,200)(5,400)
Gross Margin 3,8004,800
Variable Cost (1,600)(2,100)
Fixed Cost (1,700)(1,300)
Net Income $ 500 $ 1,400
Based on this information Ashton Company has a.
Answer: $500 unfavorable variable operating cost variance
2026 PRACTICE TEST BANK WITH RATIONALES
AND STEP-BY-STEP SOLUTION GUIDE
◉ The following information was drawn from the accounting
records of Smith Company
Static Budget Flexible Budget Actual Results
Sales $13,500$ 19,000$ 21,100
Cost of Goods Sold (6,700)(8,600)(7,250)
Gross Margin 6,80010,40013,850
Variable Cost (2,700)(3,450)(4,350)
Fixed Cost (1,700)(1,700)(2,000)
Net Income $2,400$ 5,250$ 7,500
Based on this information the.
Answer: variable operating cost flexible budget variance is a $900
unfavorable variance.
($4,350 − $3,450 = $900)
unfavorable because actual variable operating cost was higher than
expected.
,◉ The following information was drawn from the accounting
records of Smith Company
Static Budget Flexible Budget Actual Results
Sales $13,500$ 19,000$ 21,100
Cost of Goods Sold (6,700)(8,600)(7,250)
Gross Margin 6,80010,40013,850
Variable Cost (2,700)(3,450)(4,350)
Fixed Cost (1,700)(1,700)(2,000)
Net Income $2,400$ 5,250$ 7,500
Based on this information the.
Answer: cost of goods sold volume variance is a $1,900 unfavorable
variance.
($8,600 − $6,700 = $1,900).
amount of cost of goods sold shown in the flexible budget is higher
than the amount shown in the static budget, the variance is
unfavorable.
◉ The following information was drawn from the accounting
records of Ashton Company.
Budgeted Actual
Sales $8,000 $10,200
, Cost of Goods Sold (4,200)(5,400)
Gross Margin 3,8004,800
Variable Cost (1,600)(2,100)
Fixed Cost (1,700)(1,300)
Net Income $ 500 $ 1,400
Based on this information Ashton Company has a.
Answer: $400 favorable fixed operating cost variance
($1,700 − $1,300).
◉ The following information was drawn from the accounting
records of Ashton Company.
Budgeted Actual
Sales $8,000 $10,200
Cost of Goods Sold (4,200)(5,400)
Gross Margin 3,8004,800
Variable Cost (1,600)(2,100)
Fixed Cost (1,700)(1,300)
Net Income $ 500 $ 1,400
Based on this information Ashton Company has a.
Answer: $500 unfavorable variable operating cost variance
